The DSE Brokers Association of Bangladesh (DBA) has sought full tax exemption till 2030 on capital gains earned by individuals and foreign investors from listed securities, aiming to restore investor confidence, boost market liquidity and encourage long-term investment.
In a press release Saturday, the DBA said it submitted a proposal on Wednesday to Finance Minister Amir Khosru Mahmud Chowdhury, Special Assistant to the Prime Minister for Investment and Capital Market Tanvir Shahriar Ghani, Bangladesh Securities and Exchange Commission (BSEC) Chairman Masud Khan, and National Board of Revenue (NBR) Chairman Ahsan Habib.
Currently, capital gains of up to Tk 50 lakh earned by individual investors from listed securities are tax-exempt. Gains above that threshold are generally taxed at 15 percent.
The DBA has proposed restoring a full tax exemption for individual investors and reconsidering the existing tax regime for foreign individual and institutional investors.
According to the DBA, such tax benefits would increase trading activity in the capital market, encourage investors to reinvest their profits and promote more productive use of domestic savings. They would also widen the scope for equity financing by listed companies.
The proposal suggested amending the relevant provisions of the Income Tax Act, 2023 to exempt capital gains from eligible transactions executed through stock exchanges and settled under the designated central depository system.
However, the association favoured retaining the existing tax arrangements for sponsors, directors and institutional investors.
The DBA believes that once the Central Counterparty Bangladesh Limited (CCBL) becomes fully operational, determining capital gains and calculating taxes will become easier.
On that basis, it has sought the tax exemption until 2030, by which time the CCBL is expected to be fully functional.
DBA President Saiful Islam said an investor-friendly tax regime for individual and foreign investors would strengthen confidence in the capital market, encourage long-term investment and expand financing opportunities for listed companies.
"This initiative will also help the government implement its plans for developing the capital market," he said.
The association urged the relevant government authorities to consider the proposal with due importance and take the necessary policy and legal measures.
The DBA also reiterated its commitment to continued cooperation with the government, regulators and all stakeholders for the development of the capital market.